Price risk management tools
An introduction to options
Building a marketing strategy is a constantly evolving process. Each year will need different tools and techniques to protect against, and benefit from, price volatility. Here we provide the basics of how options work to protect grains and oilseeds form price volatility.
Examples of marketing strategies that use options contracts
Options contracts can be used to supplement your existing marketing plan rather than replace it. Using options can provide returns even when stores are empty of physical grain, but it requires familiarity of potential future market direction.
Budgeting, why now and how can this benefit us?
Budgeting is a useful tool when growing grains and oilseeds. Calculating costs of production by tonne by crop type can help you understand at what price your crop could make a profit, and so help manage your cashflow.
Breakeven yields; an alternative way to view profit margins.
Beating a forecast 2021/22 UK average wheat yield by 1.0t/ha could net an average farm business a gross margin per hectare 88.6% higher than if the average yield was achieved.
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